Q1 Los Angeles Multifamily Market Report
Market Overview
Los Angeles (LA) has a vast economy, playing a significant role in national entertainment, tourism, international trade, fashion, and aerospace industries. The city is rich in creative workers and entrepreneurship, fostering business formation and self-employment. Notable talent generators include top-tier universities like USC, UCLA, and Cal Tech, supporting a growing tech ecosystem. Tourism also plays a vital role in the economy of the region. Businesses such as shops, eateries, and hotels in popular tourist destinations like Downtown L.A., Hollywood, Beverly Hills, and Santa Monica rely heavily on tourist spending. Notably, Los Angeles attracts over 50 million visitors annually.
Market Performance
Asking rents hit a low point in December 2023 but started rising again in Q1 2024, driven by increased renter demand. Additionally, Los Angeles apartment rents are expected to grow at a faster rate for the remaining quarters of 2024. As of Q1 2024, rent growth stands at 0.2%. As for construction, there were 10,000 net new market-rate units completed in the last year, leading to an inventory growth of approximately 1%. The level of development has remained steady over the past six years, with an annual addition of between 9,000 and 12,000 units since 2018. Q1 2024 sales volume totaled $916 million, following the $1.3 billion in transactions from Q4.
Los Angeles By The Numbers | Past 12 Months | Source: CoStar Group
- Vacancy Rate: 5.0%
- Rent Growth: 0.2%
- Delivered Units: 10,016
- Absorbed Units: 5,401
- Sales Volume: $3.9B
